Depending on what the print is. Im usually the guy that comes on and says ignore the Economic Data. Its already priced in. I think in this case if we get a hot jobs report that contradicts the little bit of relief we got from adp in the middle of this week, i think that youre going to make new year lows in all the major indices. I really dont think theres any way around it. I really think if this, then that, and its as simple as that. I wish it werent so. I wish people werent reacting that furiously to a monthly look at whether or not we add 80,000 or 90,000 jobs, but absolutely the markets will be quick on the trigger. A lot of this stuff is algorithmic anyway, it doesnt require human beings until later on. I think that probably dictates the next thousand points in the dow, and what it does beyond there, i dont know. The good news is economists are looking for about 170,000 jobs. If, in fact, we come anywhere near that number, that would be below the 187,000 we added in august. And i think its doable, and i think in large part we might be helped out by the auto strikes. This might not show up in this month. Maybe thats next month. The fed, i think, is miscalculating by continuing to pound on this higher for longer, higher for longer, higher for longer. Theyve set up a scenario where every uptick means another trillion dollars coming out of the stock market. Its stupid messaging. I think they can calm it down a little bit. They have largely gotten their way all over the economy, and so if we get this cooled off jobs report, i think it will really help sentiment, and its possible stocks might have seen the lows for the year if thats what we get. Keep in mind, we are very washed out. I talk about internals all the time. I want to relay to you the rsi on the index itself, on the s p 500, the rsi is now 32. 30 is the low for the year, which happened last week. We are now more washed out, though, last week and this week, than we were during the svb crisis when the rsi and the spx got to about as low as 33. Are we in worse condition economically now than when we thought there was going to be a mass bank failure . It seems so overdone. So the fuel is there for a bounce if we get what i hope we get. The problem, kari, you have people like btigs Jonathan Krinsky saying it will not be the low. People expect it to hold and you get a nice rally into the rest of the fourth quarter, but he says it may not be the chris. Another says yesterdays rally hardly gives you the all clear. You didnt even get 2 to 1 advancers to decliners, the internals are week. Barclays, we believe we have substantial room to reprise lower before bonds stabilize. Thats where the narrative is. Everybody is getting negative, so maybe thats a positive. I think what youre hearing are the people are raising their voices and the people who have been bullish are very quiet right now because the last couple of weeks are not playing into anything thats optimistic. I think we have to see what comes out of those jobs numbers, and the jobs numbers that we saw from adp were lower. We know, by the way josh said, this could be lows for the year. We could see the market come down some, but think whats happened to inflation through the course of this year. Its continued to go lower, and its still going lower. We had this spike in energy. Now we have less demand, it appears, and Energy Prices are coming down. So i think the number can well be within a range the mark will be comfortable. This has been a hiatus period. Its fine. We understand that. And, frankly, i think its time to sort of let the fed see what the numbers are. Im hurrying you along because i have some news to get to and i dont want to hold it any longer, because it is causing shares of General Motors to take a big drop. Take a look at gm shares, as we speak, i last saw down 3 intraday. Theres the big drop, and it coincides with this story. According to the journal, General Motors has at least 20 million vehicles with potentially explosive air bag parts. Again, thats according to the journal, which also says ntsa is holding a meeting right now to consider whether to order a recall over those air bag components. So if General Motors didnt already have enough issues regarding the strike, the uaw, which has no end in sight from all of our own phil lebeaus reporting and we had an interview with gms cfo on this very program, and youve gotten the gist they are far apart, now those shares are down 3. 5 . I want to talk markets. Jimmy, you own the stock. Moving this stock intraday down. You broke it for me, too. I dont want to be dismissive. This is part of automobile manufacturing and this happens quite often 20 million vehicles. Its a lot. Its a lot. I think i need more data before i make any sort of cohesive statement on it. This is not the first time youve had air bag defects. When this happens you have to think where the fiscal responsibility lies, usually with the air bag manufacturer. Remember takata a few years ago. This may look ugly for General Motors. I dont think this upsets the basic fact people need new cars and the costs usually are born by the parts manufacturer in this not by the oem. So lets turn our attention back to the market, and were trying to figure out where were going from here. I read you the notes from three voices here, stratigis, barclays, who say its not all clear. 4,200 may not hold. Bonds are going to take longer to reprise before stocks do. You have an issue here in the market potentially for your more optimistic scenario in which to remind viewers you took your s p target a few days ago. Theres a tug of war on the fundamentals. Leaving krinsky to the side because hes on the technicals, bulls like me say look how strong the economy is. Another update has us at 4. 9 , again for last quarter. You see jobless claims. People are employed. Inflation has been coming down. Not anywhere near as fast as we want it, but coming down. And the bulls like me say, wait a second, this is good for consumption, this is good for the economy and profits look like theyre set to grow again. The bears say, and theres validity to this this is provoking the fed, they will crash this economy, et cetera, et cetera. I will go back in terms of resolving this to where we were a minute ago and the jobs report tomorrow, im not looking at the top line jobs number. Thats not what im looking for. Im looking for affect Hourly Earnings and participation rates. Those are the drivers of inflation which, in turn, is the driver of the fed. I want to see hourly average growth come in below 4. 3 expectations. I want to see Labor Force Participation rate continue to pick up. This is all a precursor, scott, to next weeks cpi and ppi. Thats really, along with the pce, further out, what will guide the fed as far as november comes. Listening to Steve Liesman this morning, i think it was on squawk box, when the fed is ready, theyll change the rhetoric. Theyll stop the rhetoric, and the market can then focus on earnings, which look better than expected. Speaking of liesman and speaking of fed rhetoric, were going to hear from Steve Liesman right now, because were getting more rhetoric. Steve, San Francisco fed president mary daly is speaking at the Economic Club of new york. Whats the headline here . Reporter its a bit like, scott, listening to the conversation she is saying financial conditions have tightened considerably, so she is paying attention to whats going on with rates. She says if they do remain tight, the need for further action is diminished, action by the fed, that is, monetary policy, she says, is restrictive. Note she didnt use the phrase bostic used, sufficiently restrictive. She goes on to say if it continues to cool the fed can hold Interest Rates steady. If there is a stall, we could raise rates further. She talks about optionality quite a bit in the speech and says growth and inflation are gradually slowing. The fed doesnt have to rush to any decisions. Can watch its options here. The decline in inflation has come without significant deterioration in Economic Growth for the labor market. I want to just show you guys weve had three fed speakers now talk about this rise in rates. Daly said financial conditions have tightened. Bostic the other day said Corporation Debt refinancing could be a significant drag on the economy and may do some of the feds work for it. Barr, the vice chair for banks say they need to monitor the impact of tightening on bank credit. So they are aware. They havent suggested any time here yet, scott, they need to weaken their message yet, but, like jim was recounting what i was saying earlier today, if you look at the ten year over time go back to the september meeting a lot of this rise is because of fed rhetoric and the change in their forecast. Who knows, they could come one a different forecast today if you ask them. So my point is that what the fed gives in terms of higher yields, it could taketh away if it chooses to change its rhetoric. Thats why im watching very carefully what theyre saying right now about these financial conditions and how much tighter they are. You do have to believe to some degree theyve been moved by the movement in what we just showed from the yield on the ten year, for example, from the last meeting in september reporter absolutely. To where we are at the begin time now. If theyre not moved, then, houston, we have a problem. Reporter right. Im sorry, scott, i didnt prepare a probability chart for you. Youll see this entire move in the ten year has come with almost no increase at all in the probability of a rate hike, another rate hike this year. Still remains in that 40, 45 range, 22, 23 , up to 30 , for november. So people are not saying the fed is going to hike more. Thats been one impact. It takes that initial hike or the final hike off the table for this year. And then the question becomes, does it begin to build in more cuts, because the fed is well aware, scott, if inflation falls and rates stay high, it becomes, by definition, tighter, and it may not want that. I will just stress so far the rhetoric from fed officials ive been following has been neutral as to this rise in rates to saying that its helpful backing off the idea of an even further rate hike this year. They have not gotten to the point yet these high rates, we can cut more next year. Theyre not there yet. And the market is not moving to a place where the feds rhetoric hasnt gotten to. I essentially hear you saying as well, the market is not moving up expectations or increasing its probability there of, right . Reporter exactly. I really think, scott, the fed could have a profound effect. Lets say chair powell were to say we think these rates are, first of all, current rates are sufficiently restricted and saying financial conditions have become too tight. If you were to say that, i think the market would yields would have a strong impact which would suggest they can breathe a little bit of a sigh of relief. Im not saying there arent structuring issues here. There are. All of a sudden yields are higher and everybody who has been complaining about the deficit comes out of the woodwork and says, see, i told you so. Now im saying there is a part to the deficit here. There is some surprise issuance. There are two parts we cant forget. One is the stronger growth numbers, which is why all you people around the table are 100 right, but its been fed rhetoric and the change in their reaction function if they were to ease back, i think they could have a profound effect on yields. Great stuff, steve. Steve liesman, our senior economics reporter joining us with those comments from mary daly out of San Francisco. Is jim too optimistic . Lets go right there. Is jims forecast no, i want to have this debate. I want to have this debate. Is jims forecast too optimistic in the environment we seem to be finding ourselves in, yes or no . Every sector in the s p is now below its 50day moving average. I know that doesnt matter to jim, and obviously that could change on a dime especially if we get a big event like a cpi report or an employment report that very substantially makes it clear that the fed can be done, and they are sufficiently restrictive, but for the current moment, the markets are breaking down. I do not think that the higher for longer had been fully priced into the market. I dont think it is yet. I think youre starting to see companies materially have adverse impacts in what theyre saying on their business. You look at a company i think it was pet smart or petco, one of the pets, they went from selling bonds at 3 to 9 . You cannot tell me that happening across 1,000 publicly traded companies in the russell 1,000 isnt going to have a long and Lasting Impact on things like capex and hiring, et cetera. I think its getting really, really tough to keep saying, well, the consumer is hanging in there. The consumer is not hanging in there. The wealthy consumer is hanging in there. And if you actually look at what adp said, all of the hiring, all of the strength ergo in the economy, is in leisure, is in play time. Theres no other sign of strength anywhere. Manufacturing, net loss jobs. You saw net loss jobs in every other category, and you saw leisure 92 of a plus 89 report. Theres no strength anywhere other than people booking vacations, and that feels like its on its last leg. And dont ask me. Look at how the airlines are acting. The market has now weighed in and said, thats at its end. So its really, really tough for me to agree with jim. I hope hes right. I dont know about the formulation of the price target, but the one point i want to make thats actually positive for the intermediate term, if we can get through this moment is this. All of the people who are screaming about longterm treasury yields and what thats doing, were the same people screaming about the inverted yield curve a year ago. Yes. Its the same people. Im friends with them. I go to dinner with them. Its not just on twitter. Its in person. The reason that makes no sense, if you didnt like the inversion or you hated the inversion, you should really like whats gone on in the last eight weeks, this normalization. We are almost at the point where there is no inversion in some of the most important pairs, notably look at the threemonth ten year. If you see that normalize and become uninverted between now and the end of the year and you hated how inverted it was, pick a lane. Josh, this is such a good point and im sorry to jump in. Thats all i do, make good points. Im like a machine. You did just now. I dont see the chinese food im ready for orange chicken. Here is what youre saying, in the environment weve been in for 18 months, for the most part, good news is bad news and bad news is bad news. Everything is bad news. Read your newsletter. Of course it is. What changes that . When does that change . It changes when the fed signals that its done. Maybe they have one more rate hike, i dont know. I dont think they do. But in order to get the fed and steve was just saying this in order to get them to back off on the rhetoric they have to feel inflation is getting under control, and thats why tomorrow matters, to the point were making, and next week on cpi ppi matters. Kari, do you want to agree with me as well . You look like you do. I will disagree with you on its all leisure. It cant be if the fed is at 4. 9 gdp. Theres a lot of capex. A lot of inflation is built into that. Its a real number. Still. About the chinese food, because its looking good on you. Thank you, thank you. I would say that were talking with jim and the 4450 or something. We were at 4588 on august 1. Not very long well, fine, i understand its come down. But if we think about whats changed in the economy, what has really changed since then . The fed saying were pausing. We didnt have a rate hike. We have lower inflation. Weve had a stronger dollar with oil. But, in fact, theres not a lot of change. Weve had change in the market for the ten year. So the ten year move and the fact that the market has come down, frankly, is positive when you think about less jobs. Regional Bank Balance Sheets being turned upsidedown. But less jobs. Less jobs. Theres always risk. Theres always risk. So something has changed. Its not the market is reflecting that the economy is not as strong, but we want it to be less strong. We spend 18 months, when are the rates going to have an effect . I honestly think the rubber hit the road this august and september, and we are now getting the first of the data points to confirm that. And the market is down 9 . Those rates are biting now. Ill tell you what else has changed since the summer, earnings estimates have gone up. Up. Theyve gone up. Thats not allowed. Consensus earnings estimates have gone up from july 1st for the third quarter, for the fourth quarter, for q1 of 24. They continue to grow their optimism by small increments, obviously, as you see here. But, nonetheless, they continue to trend higher as the r environment gets dicier. That is where we are going to really find out if the rubber meets the road. Correct. Youre darned right. Imagine if those estimate revisions are correct and imagine i know im in imagine land here because were talking about the future, folks. Imagine it happens usually in delusion land. You already put yourself into imagine land. Imagine those revisions happen, that theyre true, and that inflation continues to come down. Wow. I mean, 4450 is going to have to be revised in a different direction. The problem is that inflation, after coming down a lot, isnt coming down enough at the most sticky part of the inflation spectrum. Not Housing Services i admit it is not. I freely admit inflation needs to do better. Cant you see a scenario where the conversation flips to, oh, wait, why is it coming down . Were already seeing demand for oil story this week. Thats totally valid. Thats a valid point. What if were in a recession, and thats why its coming down . What if tomorrow you get 4. 2 on affect Hourly Earnings, and you have those revisions you just mentioned. Thats a pretty powerful combination. Its not from 6 . Joshs point is if you get a hotter than expected jobs report, something that doesnt mess with the adp report, thats a decided negative for the market given where we are. I agree. Given where rates have moved. Here is the problem with that i agree. Youre arguing that you want the economy to be so strong, and it is so strong, but then youre saying its bad no, im sorry to interrupt. I thought i was clear. I want the jobs number to exceed, along with, and, having average Hourly Earnings below expectations. Goldilocks. Yes. You want more jobs but lower wage gains . Thats what we should all want. Theoretically but i dont know if the market wants that. Again, let me cook, the fed has now conditioned us to interpret anything positive as, oh, no, higher for longer, again and again and again. I dont like that theyve done that. I dont like thats where the market is. I promise you the way the algorithms are written better than expected equals sell. Simplest. Can i stir for a minute . Go ahead. If we have in the next few weeks many earnings reports, some from very Big Companies that suggest that theres more strength on the technology side, that some of the Consumer Services companies are really showing a resumption of strength, which theyve really lacked for 18 months, i think that shows something to the market, and even if we dont have the scenario respectfully, we got that last quarter. It helped. No, it didnt. As soon as earnings season ended, it was like a trap door opened. Let me get in real quick. Forgive me for interrupting you but mary daly, you saw liesman, it wasnt like that was the end of her commentary at the Economic Club, suggesting from headlines that continue to move that recent bond market tightening, according to mary daly, equal to about one rate hike, suggesting, also, if yields remain high, no need for another hike. So exactly what Steve Liesman was talking about is being discussed as we speak in real time by mary daly, the San Francisco fed president , and thinking about what that tightening of financial conditions has done equal to one rate hike in her mind. So maybe you start moving the ball past the goal line of, were done, and thats going to be the rhetoric to listen to closer than anything else as we move forward from Voting Members. Mary daly is not a Voting Member. Keep that in mind as well. Lets take a quick break. Our call of the day. One analyst says close your eyes and buy quality. Were back in two minutes. The first time you connected your godaddy website and your store was also the first time you realized. Well, we can do anything. Cheesecake cookies . The chookie manage all your sales from one place with a partner that always puts you first. we did it start today at godaddy. Com all right. Welcome back. Utilities talking a lot about those this week hitting a 52week low falling to the lowest level in three years. Today keybanc has seen enough, it appears inexpensive and you can close your eyes and buy quality, in their words. Great to have you on, kari. Nexterra has been in the eye of the storm. Josh had it, he sold it. You still have it. Another new 52week low today. What do we do here . Plays right into the bond conversation weve been having. Yield is up, utilities down. What about this name . I didnt know i liked keybanc so much until now. I would say the following. We bought the stock when it was down considerably and we thought between the utility side of it, which, in general, utilities have been sold all year. We sold American Water works because of the pressure from higher rates. This case is about their Renewable Division which has been one of the engines of growth, but it needs financing because in order to do these projects and to sell them, you have to have a financing arm, and with rates higher, thats a problem. That and the whole level of debt they have and Interest Rates higher have hit nextera. Do we think this is enough to keep the stock from going down, we think its oversold here. Weve gone through the Different Levels of debt, the different projects involved. We have not sold it. We are doing the work on it and will have an answer about what were going to do in the next few days. Right now our answer to the question is we think its overdone because that was why we bought this and electrification of the country is happening everywhere. Keybanc upgraded by removed nextera. I dont like them now. Thank you, josh. Lets focus on these comments from mary daly. Theyre happening not all that far from here on the Economic Club, as we said, of new york. Bond yields, if you want to show the ten year intraday, i think its moved on her commentary. Yes. Which has come off the high of the morning. Stocks have improved. Were obviously red. Im not trying to act as though the stock market has all of a sudden turned around but its certainly off the lows. Jim, if the market as a whole can get its arms around the idea this move in yields has been so significant and in such a short period of time, for the most participate, its moved the fed. Its moved their thought process into even considering whether they would do one more, as mary daly said, the equivalent of one more. And if they might be done and move to be done and that breaks the fever of what weve witnessed with yields. I think what you just laid out is exactly what i feel, what i believe will happen. What you left out but ill add to it, the economy has to hang in there, and along with it profits grow along the trajectory we were talking about earlier. I have to say this about Economic Growth and profits, right now it looks like thats going to happen. This is one of those fdr moments where what we have to fear is fear itself, and were right on that precipice of where the fed doesnt feel comfortable soon, then that negative sentiment is going to really flow through to ceo office who is will start laying off people, who consumers who will say im done. Im not going to spend on the holiday season. To investors who will say, all right, im throwing in the towel. We are getting close to a day of reckoning where the rhetoric and the sentiment does need to change. I take comfort from what ms. Dal daly is saying . Are you looking as keybanc suggests, close your eyes and buy quality in that area . I am looking. Im not ready to pick a name. I didnt wake up and say, i have to find that you till stock. Its not a bad call. I think were supposed to start looking because Companies Like nextera, thats a fabulous company. Thats nuclear wind, regulated utility, the price was wrong. Sorry, folks, the price was wrong. When they find its price level, that is something we can buy. The tenyear yield is equal to the earnings yield of the s p 500. This is a good point. Has not happened since 2002. This is historic stuff were living through. Lets think about utilities and who the buyer of utilities are. Its people who prize the income fee tour from the dividends above most other considerations. Maybe theyre also low vol investors but they are people like jenny focused on what is the yield, and then they work backwards, should i buy it at this price because of the valuation, blah, blah, blah . Is that buyer coming . So long as there is this much of a discrepancy between the average dividend yield and i know theres preferential treatment, and what you can get from a riskfree instrument. Your point is very well made. But those change. This is a volatile time right now. Theyre changing in front of our eyes. You need to say, ill close my eyes and buy this. Extend your argument. I dont care about utilities right now. But extend your argument to other sectors of the market where youre making a fabulous point. You didnt call the equity risk premium but thats what youre talking about, where it is higher because the p e is lower and yields are good. Im talking about energy, talking about materials, talking about financials. You cannot do that, folks, unless you agree with me that this economy is not going into recession. But thats where your argument extends to. You think it will hold up for energy. Absolutely. You can buy an integrated oil player, 11 times earnings, 2, 2. 5 yield. Can you do that. I agree with you. If youre in the recession camp, you cant do that. What about goldman, jpm down goldman is down, i thought earlier i dont know what it is now. 3 , 4 . We can pull up goldman. How should we view the banks . You have jpmorgan. We have to break the banks in half. We have to talk about jpmorgan differently and maybe wells fargo differently than were going to talk about Morgan Stanley and Goldman Sachs. They had really nice rallies. Goldman has come off the mat. Its obviously not down 3 , 4 . We have to talk about the banks with heavy Capital Market exposure differently than the banks about to tell us how much theyre making. Its not necessarily going to be the same companies and same types of reports. And then i think we have to look further and say which are holding on to billions of dollars worth of mortgages even if its in their portfolio that have upsidedown Balance Sheets. And at what point does the street even more severely discount as a result of what those Balance Sheets look like . These banks, im in jpmorgan. I think its the highest quality. They did not go all in buying mortgage bonds when rates were substantially lower. They just didnt do it. I would prefer to be there than i would in, lets say, theback of americas. Lets get the headlines with silvana henao. Hey, scott. The pentagon could be making controversial cuts to the Armys Special operations forces. According to a wall street journal report. As the force struggles with recruiting and is shifting focus from the middle east to china. A military official told the journal the army plans to cut special operations troops in supporting roles. These cuts could total 3,700 troops. The Maryland Supreme Court will hear oral arguments in adnan syeds case. He has spent 24 years fighting charges that he murdered his former girlfriend in 1999. Last year a judge vacated syeds conviction. An Appeals Court reinstated the ruling in march. They will decide if syed heads back to prison. President biden and other highprofile democrats are expected to honor senator Dianne Feinstein at her Funeral Service today. The president will deliver an audio message tribute to the senators life and legacy. Other leaders, including Vice PresidentKamala Harris and former House Speaker nancy pelosi, will make remarks in person. Scott . Silvia, appreciate it. Thank you. Silvana henao. Trouble in the friendly skies. Two major firms slashing their targets on a number of airline stocks. Well talk about that and have some moves to get to as well. Jim has ded adto two stocks hes already owned. Ill tell you which ones next. React to fastmoving markets with dynamic charting and a futures ladder that lets you place, flatten, or reverse orders so you wont miss an opportunity. E trade from Morgan Stanley. Meet gold bond daily healing. A powerhouse lotion that moisturizes, heals, and smooths dry skin. With 7 moisturizers 3 vitamins. And. New gold bond healing sensitive. Clinically shown to heal moisturize dry, sensitive skin. Gold bond. Were back. The dow still down 100 points. Jim, you bought more oracle and deere. Why . First off, the bigger comment is getting invested. Scott, i think you were on vacation when i did lighten up, late august or early september. I forget when but i did why is that funny . Ill send my schedule over. Im having a rapport with my man, having a good time with him. He wasnt here when jim took some profits and sold some stuff. Even weiss backed me up on this the other day. Moving on, time to put that money back to work, all right . You look at deere and oracle, two companies i love their business models. I think their results are fantastic. Both off 17, 18 from july highs. The money i took out from Goldman Sachs and dover, theres the opportunity to put it back to work. Everybody knows what my thesis is right now. I want to get investing. Josh, what do you make of the moves . You know oracle well because you used to own it and deere, too, at some point. It will kiss that level before turning around, i mean, if you have a massive market rally on a good jobs report, forget everything i just said because that will trump the individual stocks technicals short term. Thats a tricky area right here. I would let it come in. Whats the other one, deere . No support. I have no opinion on deere, but the markets opinion is that this stock is probably range bound. If you think about just the last threeyear period, very well defined high, just above 400. Very welldefined low. Maybe thats an area where you can make some money trading in between. But there doesnt seem to be any direction here just yet. Kari, you dont like it. I saw you shaking your head. I think, again, the chart doesnt look good. I dont know, i think there are better ideas. Can i just point out, not a lot of charts look good in the market. Correct. We can say that about every stock out there. True. Thats a fair point. Mike santoli will join us next for his midday word right teth. S every day, businesses everywhere are asking is it possible . With comcast business. It is. Is it possible to help keep our Online Platform safe from cyberthreats . Absolutely. Can we provide health care virtually anywhere . We can help with that. Is it possible to use predictive monitoring to address operations issues . We can help with that, too. With the advanced connectivity and intelligence of global secure networking from comcast business. Its not just possible. Its happening. Is it possible my network could take my business to the next level . It is with comcast business. Powering all your devices with gigspeed wifi. And you get fast downloads and uploads. Pick it up pick it up oh we got this because its powered by the next generation 10g network. More speed for your business . Its not just possible. Its happening. Get started for 59. 99 a month for 12 months. Plus, ask how to get an 800 prepaid card with a qualifying internet bundle. Comcast business, powering possibilities. Our senior mark commentator mike santoli here for his midday word. Lets make it about what mary daly is talking about. You have to believe at some level the fed will be moved by tightening, that the market has already done for it. It was one of the Big Questions about the run of fed speak that we saw, right, the first is to reiterate the message from powell. And with the market moving so far and so fast, i do think it helps at the margin to have them acknowledge that this isnt necessarily out of the set of variables they have to look at. Its a net positive. Its a tricky spot because you dont want everyone to be in a position of wishing for softer and softer Economic Data in order to take the pressure off of yields, in order to get the fed to say, okay, maybe were done. And so maybe this creates a little bit of daylight where you can have okay data because of what the yields have done and still have that balance picture. I think thats a great point that you make that good news can be good news ba because the movement has allowed it to be good news by doing the work the fed may not have to do irrespective of who says what and when and you have to Pay Attention to it and who is a Voting Member and who isnt because it matters more than people think. I never really thought the next move or nonmove would be the key swing factor. Its the market is mostly struggling with this rampage that yields are on. Whats that doing in the real economy now and in the next six months . That being said, if the fed doesnt say, yep, thats participate of our plan is to have unemployment go up a lot and to bring the earnings picture into question, i do think that its a net positive. Not going to be a savior. I always think good news is good news, by the way. The window of time when bad news is good news is brief and fleeting and you dont want to get in that mode of wishing for Something Like that. I always feel like the trade is lower. Sometimes its higher tactically. For everybody its usually lower. You are correct. Obviously another 25point hike in the big picture means nothing. It is, though, brings forth the idea whether the fed is tone deaf in some respects by whats actually going on in the market around them and what might happen as a result of that move. So when, in fact, 25, whatever it is, is not the issue. Its the inability to recognize whats happening and keeping doing more. I think theres also a sense you dont want to get too complacent what theyre thinking or might say which could be, look, weve been trying to get the projected rate cuts out for a long time and finally this is happening at the longend of the curve and 4. 7 on the ten year in the abstract is not too high given where nominal growth is, we got hit in a hurry and have to wait and see what damage was done along the way. I suppose comforting to some they seem to acknowledge that. Thats right. Some of them do like mary ly. Ill see you in a bit on closing bell. Since my citi custom cash® card automatically adjusts to earn me more cash back in my top eligible category. Suddenly lifes feeling a little more automatic. Like doors opening wherever i go. [sound of airplane overhead] even the ground is moving for me yall seeing this . Wild and i dont even have to activate anything. Oooooohhh. Automatic sashimi earn cash back that automatically adjusts to how you spend with the citi custom cash® card. [mind blown explosion noise] i do have calls to get to. Amex, kari, one of them. You own it. Name the top pick at bank of america. Buy rating, price target 202. Significant upside from where it is. What do you think . I like them. Love bofa today. I think its a good call because this is a stock that sells for 12 times next years earnings. It continues to chug up. I think you have currency is sending more people overseas right now. Thats good. People are traveling. Of course the stock has been having its jitters because of recession fears, but were not in a recession now. The slowdown isnt going to stop all the spending on amex. Youre not super bullish not nearly as bullish on the Economic Outlook as jim is. Youre much more tempered on that. And you do worry about tempered that so how can you brush that fully to the side and be so optimistic about American Express . One ties into the other. Theyre a higherend audience the market has been growing for them. The growth in amex cards have been very much focused, as you know, on the 30 and 40yearolds. Jimmy, lets talk airlines stocks. Goldman and ray jay. In terms of what you own. Goldman takes escalation from 512. Ray jay takes alaska to 58. Delta at rayj. The point being these. I hope they are right. Those targets are way above where the share prices are right now. Looking at alaska, it looks like a 60 increase, at least in ray j. Thats about on 30 increase. I think youre just seeing some housekeeping. We have addressed that. Im not happy about it. That wouldnt tell the whole story, obviously. Whether its alaska or delta, from either shop its reiterating a buy or strong buy. Theyre just maybe having a bit of a reality check. Thats exactly right. Theyre still urging people to buy the stock. Its housekeeping. They have to do this. I think whats more relevant for all of us, delta will report i think next wednesday. I can tell you right now, just in the present time, we are well above prepandemic level on a sustainable basis. Yes, fuel is a problem, yes, labor has gone up. These are normal in any business, you sometimes have costs ebb and flow, but you want to see it hang in there. Did i trigger you by talking about the airlines . [ laughter ] scott pointed out on tuesday, you probably just had airline nirvana for the last two years. You may never have an environment like that where the propensity to travel ever again. Does this make since to you, jim . Southwest 31 sometimes earnings, alk 28 . And then i dont think those numbers are even remotely right why is that . Because the market is thinking a recession is coming. If you look at the analyst estimates, they are higher than the beginning of the year. And yet the stocks are down. Why . Because nobody believes the earnings are really maybe we want to buy when p e ratios are double digit your point is exquisite. Alaska pedestrian in may of 21. All these air loons have been minting money, paying down debt. Their Balance Sheets look a lot clear are than ever. The other thing that is clear, we need to take a break. Final trades are on the other side. When youre looking for answers, its good to have help. Because the right information, at the right time, may make all the difference. At humana, we know thats especially true when youre looking for a Medicare Supplement insurance plan. Thats why were offering seven things every Medicare Supplement should have. Its yours free, just for calling the number on your screen. And when you call, a knowledgeable, licensed agentproducer can answer any questions you have and help you choose the plan thats right for you. The call is free, and theres no obligation. You see, medicare covers only about 80 of your part b medical expenses. 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Its just one of the ways that humana is making healthcare simpler. And when you call, a knowledgeable, licensed agentproducer can answer any questions you have and help you choose the plan thats right for you. The call is free, and theres no obligation. You know medicare wont cover all your medical costs. So, call now and see why a Medicare Supplement plan from a company like humana just might be the answer. All right, 3 00, closing bell, jeremy siegel, the professor with me. Joe t. , and bill miller iv will be with us. I hope you join me. Well see what the market will do. Lets do final trade. Farmer jim . Exxon mobil, this seems like the easy button. Buying back shares, and its on sale. Carrie . Fortive. Mid cap tech name. Its come down. We buy here. Crowdstrike, look for the names in your portfolio that are stronger. Those will have the best move. Good stuff. Ill see you in a couple hours, the exchange is now. Thank you, scott. In the tug of wars, the jobs report tomorrow morning could dictate the next move. Our next guest says stocks and yields are both heading lower here. Hes here to tell us what he means by that. Home builders have been in the sweet spot, and their able to buy down rates. Is it time to bail